"There was never any intent of creating conditions that were designed to defeat the testing process. This is absolute nonsense," he added.

Shares in Fiat Chrysler ended the day 10.3% lower in New York and closed 16% lower in Milan.

The EPA said Fiat Chrysler could be liable for fines of about $44,500 per vehicle, which would mean a total of about $4.6bn (£3.8bn).

'Serious violation'

According to the EPA, the 104,000 vehicles affected were 2014, 2015 and 2016 model years of the Jeep Grand Cherokee SUV and Dodge Ram truck.

Between "one-sixth and one-seventh" of the vehicles were sold in Europe, with the rest in the US, according to Fiat Chrysler.

In a press conference, the EPA said at least eight types of emissions control software on the vehicles had not been disclosed to the agency.

It also suggested some of the software appeared to make cars perform differently during emissions tests.

"Failing to disclose software that affects emissions in a vehicle's engine is a serious violation of the law, which can result in harmful pollution in the air we breathe," said EPA official Cynthia Giles. "All automakers must play by the same rules."

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Fiat Chrysler said it would demonstrate that its emissions control strategies were justified and thus were not "defeat devices" designed to get around emissions tests.

It also said it had responded to requests for information from US authorities and sought to explain its position.